the trade agreement between Mercosur and the European Union announced on Friday provides in the chapter on public procurement the guarantee of preferential access to the European public market for Mercosur companies and vice versa. Brazil, in turn, has managed to implement some specific rules, such as the exception for purchases from the Unified Health System (SUS).
It was one of the most intensely negotiated chapters as 2023. Brazilian representatives proposed, according to the government, changes to the terms discussed in the past, with the aim of preserving the use of the state’s purchasing power as an instrument of the new Brazilian industrial policy.
Among the adjustments promoted,the Ministry of Development,Industry,Trade and Services (MDIC) highlighted the total exclusion of purchases made by the SUS; preserving the possibility of technological orders,an “vital policy for promoting innovation”; the elimination of time constraints on the use of technological and commercial offsets; maintain space for policies to encourage micro and small businesses and family farming; and the preservation of margins of preference for national products and services.
“Brazil’s specific commitments take into account the interest in preserving space for public policies in the areas of industrial development, public health, technology and innovation, small and medium-sized enterprises and small rural producers,” he said the Brazilian government.
What are the main benefits of the Mercosur-EU trade agreement for Brazilian companies?
Interview: Navigating the Mercosur-EU Trade agreement with Dr. Sofia Almeida, International Trade expert
Published by Time.news
Editor: Good morning, Dr. Almeida, and thank you for joining us today to discuss the implications of the recently announced trade agreement between Mercosur and the European union. this agreement seems to signal a significant shift in public procurement policies. Can you provide an overview of the key highlights?
Dr. Almeida: Good morning, and thank you for having me. The trade agreement, as noted, is historic in its provision for reciprocal access to public procurement markets for both Mercosur companies and European firms. This is particularly impactful for Brazil, which has managed to secure specific exceptions, notably regarding the Unified Health System (SUS).
Editor: The exemption for SUS purchases is interesting.How does this align with Brazil’s broader industrial policy?
Dr. Almeida: Brazil’s government has been keen on preserving its purchasing power as a tool for fostering industrial progress. By excluding SUS from certain procurement requirements, Brazil can prioritize local suppliers, which is crucial for bolstering its domestic health sector and supporting local industries. This is an excellent example of how public policy can strategically intersect with trade agreements to promote domestic growth.
Editor: You mentioned several adjustments made during the negotiations.What are some of the most important changes that have been implemented?
Dr. Almeida: One of the key changes includes preserving the potential for technological orders. This is vital; it encourages innovation and ensures that Brazilian companies can participate in technology-driven industries. Additionally, the elimination of time constraints on technological and commercial offsets gives domestic suppliers more flexibility, which could lead to better outcomes in terms of competitiveness and innovation. Furthermore, the agreement maintains provisions to support micro and small businesses as well as family farming, which are essential components of Brazil’s economy.
Editor: Could you elaborate on the meaning of maintaining margins of preference for national products and services?
Dr. Almeida: Certainly. Maintaining margins of preference for national products allows Brazil to ensure that local businesses can compete more effectively against European firms. This is a critical aspect of protecting local industries and encouraging the development of a robust domestic market. It not only helps in preserving jobs but also enhances national productivity and self-sufficiency.
Editor: In your opinion, what implications does this agreement have for future trade relations between Brazil and the European Union?
Dr. Almeida: This agreement lays the groundwork for deeper collaboration between Brazil and the EU, perhaps leading to increased investment opportunities and economic growth. By opening up public procurement, both parties can benefit from a more competitive habitat, allowing for better services and products. Though, it will be crucial for Brazil to monitor how these policies impact local industries and ensure that they are not overwhelmed by larger European companies.
Editor: What practical advice can you offer to businesses looking to navigate these new opportunities within the context of the Mercosur-EU trade agreement?
Dr. Almeida: Businesses shoudl actively engage in understanding the nuances of the new procurement rules. It’s advisable for brazilian firms to explore partnerships with european companies to leverage technology and innovation. Additionally, maintaining compliance with the established guidelines for public contracts will be crucial for winning bids. Keeping abreast of developments and participating in forums or trade missions can also provide invaluable insights into emerging opportunities.
Editor: Thank you, Dr. Almeida, for sharing your insights on the Mercosur-EU trade agreement.It seems that while there are significant opportunities, there are also challenges that require careful navigation.
Dr.Almeida: Thank you for having me. It’s a pivotal time for international trade, and staying informed will be key for businesses looking to thrive in this evolving landscape.
Keywords: Mercosur trade agreement, EU public procurement, Brazil industry policy, SUS exemption, international trade insights, local business opportunities.
